Auto Makers' Firmer Pricing Risks Denting Sector's Recovery - WSJ.com:
"Firm pricing may have worked for the auto industry when a sales level of 16 million cars and trucks a year in the U.S. was considered normal; now the annual-sales rate is less than 10 million."
A couple years ago, analysts assumed 16 million in annual auto sales was a legitmate number. Now that legitamte number is 10 million. A 37.5% drop points towards the annual sales rate as a figure that doesn't pass the smell test.
Adjustments for seasonality and annualizing one month rates are likely the two big factors that "offend" an investment performance measurement expert. Valuing portfolios for large cash flows covers the seasonality i.e. surges in assets under management due to IRA payments in April, and an outright ban on annulaizing returns less than one year covers the tricks on one-month sales' rates.
Rationalized or not, I can't shake the feeling the car and trucks annnual sales rate is too volatile to be accepted at face value.
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